ODP rejects Staples' takeover offer, proposes alternate plan

Office Depot owner ODP Corp said on Tuesday it rejected bigger-rival Staples' more than $2 billion takeover offer, and alternatively proposed merging only the retail operations of the two office supplies companies.

ODP, which also owns OfficeMax and IT service provider CompuCom, said it preferred a sale of its retail and e-commerce operations or a joint venture to a full takeover. Its shares fell about 5% in premarket trading.

Privately owned by Sycamore Partners, Staples earlier this month offered $2.1 billion for Office Depot, its third attempt in combining the companies.

The news was first reported by the Wall Street Journal.